Ludwigshafen, Germany - The European Commission has approved the acquisition of Cognis Holding GmbH by BASF SE, 30 Nov press release from the German firm. Cognis is a speciality chemical manufacturer, with products including functional materials and solutions for industrial markets such as coatings and inks.
The approval is subject to the divestiture of businesses that accounted for sales of significantly less than €100 million, which is less than 3 percent of Cognis' total sales, the statement explained, adding that the Chinese authorities have also approved the acquisition.
The transaction has now received approval from all relevant competition authorities and is expected to be finalised in the first half of December.
BASF has committed to the European Commission to divest the following businesses and assets located at Cognis' site in Hythe, England:
• the Cognis hydroxy methacrylates business;
• the Cognis multifunctional methacrylates (MFM) and adducts business, and
• plants for the manufacture of polyalkylene glycols (PAG) and PAG-based lubricants.
BASF will retain the business including the customer base and intellectual property rights and will receive PAG and PAG-based lubricants manufactured at Hythe through a toll manufacturing agreement. BASF will grant a license for the manufacture of these products to the purchaser of the plants.
In June 2010, BASF announced that it had reached an agreement with Cognis Holding Luxembourg S.a r.l. controlled by Permira Funds, GS Capital Partners and SV Life Sciences to acquire the speciality chemicals company Cognis for an equity purchase price of €700 million.
Including net financial debt and pension obligations, the enterprise value of the transaction is €3.1 billion.